This investigation enters a further phase, with Revenue to receive information on Single Premium policies directly from certain insurance providers.

Similar to the procedure operated with previous investigations, certain financial institutions are to provide Revenue with policy details on foot of High Court orders. This is to allow Revenue to follow up on cases where tax is outstanding and where they suspect disclosures were not made during last summer's “disclosure window”.

In the nature of things, the use of High Court orders to secure information is something of a blunt instrument, as details of policies held by fully compliant taxpayers will also be sent to Revenue. Customers of the insurance companies will be notified as the information is being sent.

We understand that the Revenue Commissioners asked in the course of seeking the High Court Orders that the insurance companies, when writing to their customers advising them of the information to be sent to Revenue, include a declaration form that compliant taxpayers can complete and return to the Underlying Tax (Insurance Products) Project. The completion of the form would be a factor when Revenue come to determine which taxpayers are to be further contacted as the investigation progresses.

Revenue's attempt in this way to eliminate compliant taxpayers from needless investigation and correspondence is to be welcomed. Accountants will recall many instances in earlier investigations where correspondence arose on foot of High Court orders, but directed at compliant taxpayers.

Unfortunately, the declaration form which Revenue are inviting people to complete is too broad. ICAI has asked for an opportunity to consult with Revenue on this matter. This declaration mechanism was not debated through the TALC process prior to its being announced. We can understand Revenue's motivation for such a declaration. In the past, some taxpayers made declarations in regard to one investigation, for example the Bogus Non Resident Account investigation, while omitting details of other tax defaults which surfaced in subsequent investigations. We can't condone this, but neither is it fair to expect taxpayers to make open ended declarations arising from one issue.

A notification from an insurance company that policy details have been sent to Revenue should not be ignored. Where the taxpayer is compliant, Revenue should be notified to that effect, perhaps by confirming that the policy was funded from taxed income. Where there are outstanding tax issues, it should be noted that the protections offered by the Audit Code of Practice, that is, removal of the threat of publication and prosecution along with reduced penalties, are no longer on the table.